Klarna is on the way to restoring its financial performance to an acceptable level.
According to the results of the first quarter of this year, this company reduced its losses by half. Representatives of the fintech firm predict that a return to profit will occur before the end of 2023.
The Swedish company Buy Now, Pay Later (BNPL) reported that according to the results of the first three months of this year, its net losses amounted to SEK 1.3 billion, which is a decrease in the negative indicator compared to the previous quarter. The revenue of the fintech market player from January to March 2023 amounted to 4.9 billion SEK. This result indicates an increase indicator of 13% compared to the previous quarter.
The company’s management expects that the activity will return to the profitable category in August or September of this year. Klarna chief executive Sebastian Siemiatkowski said the firm is on track to achieve profitability in 2023.
At the end of last year, the company’s value amounted to $ 6.7 billion. As of the beginning of 2022, this figure was $46 billion. In February of this year, the company announced that its losses on the results of last year amounted to $ 1 billion. The firm’s entry into the American market has become a promising solution that forms the basis for growth.
Recently, the company presented an artificial intelligence-based shopping tool. The firm has also established a partnership with Airbnb. The implementation of the cooperation program will allow the company to offer its customers flexible payment options in Canada and the USA. Thanks to this partnership, consumers can split housing reservations worth more than $500 into four payments over six weeks.
Klarna was founded in 2005. The company is one of the first players in the BNPL market.
Currently, the BNPL industry is under scrutiny from regulators. There is concern that some lenders are encouraging their customers to overspend. In the United States, a March study by the Consumer Financial Protection Bureau testified that BNPL users in average cases have large debts compared to consumers of traditional lending services.
As we have reported earlier, Klarna Uses AI to Personalize Shopping Feed.
Serhii Mikhailov
Serhii’s track record of study and work spans six years at the Faculty of Philology and eight years in the media, during which he has developed a deep understanding of various aspects of the industry and honed his writing skills; his areas of expertise include fintech, payments, cryptocurrency, and financial services, and he is constantly keeping a close eye on the latest developments and innovations in these fields, as he believes that they will have a significant impact on the future direction of the economy as a whole.
